The problems of fraud and identity theft that result from the use of payment cards, such as credit and debit cards, are increasing throughout the world. In recent years, reported losses due to identity theft in the U.S. alone were more than $48 to $315 billion dollars, the majority coming from credit/debit card transactions. In 2009, the number of physical credit/debit cards in U.S. circulation exceeded 1.5 billion cards, and there were tens of billions of credit card and debit card purchase transactions.
With each and every one of those payment card transactions, whether transacted in a physical store or as an online purchase, each cardholder typically leaves behind all the information necessary for another person to be able to make an unauthorized payment card transaction. For example, the assigned 16-digit credit card number and 3-digit security code that are embossed on many credit cards are fixed and never change, and are easily and quickly readable by dishonest clerks, cashiers, and other personnel.
Many consumers carry more than one payment card. Not only is this inconvenient, but if a wallet or purse containing a consumer's cards is lost, each payment card account is susceptible to having fraudulent charges made by an unscrupulous person who might find the card.